Pakistan, June 13 -- The budget saga is far from over. Pakistan has turned its eye squarely on the digital economy, proposing significant new levies. A new Digital Presence Proceeds Tax Act imposes levies on a wide range of online transactions, from local e-commerce to streaming services, in an effort to broaden the tax base. The budget outlines tiered transaction taxes (ranging from 0.25 to 2 per cent) and a two per cent sales tax on each transaction, as well as a five per cent withholding tax on payments to foreign online vendors.

Islamabad aims to capture revenue from booming online shopping and global tech firms. FBR Chairman Rashid Langrial, however, emphasises enforcement over new taxes to hit targets. Hefty penalties are also prop...